Federal Court of Appeal sets Jan. 24 for hearing on Rogers-Shaw deal

OTTAWA — The Federal Court of Appeal will hear the Competition Bureau's appeal of a decision that cleared the way for Rogers Communication Inc.'s takeover of Shaw Communications Inc. on Jan. 24.

The Competition Bureau is appealing the Competition Tribunal's dismissal last week of its efforts to block the $26-billion deal, stating the tribunal made fundamental errors of law. The bureau on Monday secured a temporary, emergency stay to halt the deal until the Federal Court of Appeal hears its case.

Jonathan Lisus, a lawyer representing Rogers, said Tuesday that a formal order for the hearing date will come Wednesday but that the Commissioner of Competition will have to submit its case by Jan. 13 while the companies will have until Jan. 17 to respond.

In a filing to the appeals court, Rogers and Shaw pushed for an expedited appeals process as they still look to close the deal by their already extended Jan. 31 deadline.

The two companies said in their submission that if the deal were to go beyond the date there is a "real risk that the transaction will not close in its current form, or at all."

RBC analyst Drew McReynolds said in a note earlier Tuesday that he still thinks the deal will go through.

"While the timing of the deal closing continues to be somewhat uncertain, we believe each of the three companies remains committed to the transactions and that there is a high likelihood that the transactions close."

The Competition Bureau faces an "uphill battle" to overturn the tribunal's ruling, while even if the deal is delayed into mid 2023 it would likely still close, said McReynolds.

He said there was however still the remote chance that the bureau is successful in its appeal, or in the case of another loss, the bureau could potentially further delay the deal by appealing to the Supreme Court of Canada, which could stretch out a closing into an unsustainable timeline.

The deal also still requires approval from the department of Innovation, Science and Economic Development Canada. Minister François-Philippe Champagne said in a statement Saturday that he will make a decision only after there is clarity on the ongoing legal process.

In its ruling last week, the tribunal said the merger was not likely to result in higher prices for wireless customers and that it was satisfied the plan to sell Freedom Mobile was adequate to ensure competition isn't substantially reduced.

Rogers and Shaw made a joint statement Friday noting their deep disappointment in the bureau's efforts to block the deal but they remain committed to seeing it through.

The bureau had argued that the merger of the two telecommunications companies would lessen competition, trigger higher prices and lead to a worsening of service.

This report by The Canadian Press was first published Jan. 3, 2023.

Companies in this story: (TSX:RCI.B, TSX:SJR.B)

The Canadian Press